Lapses in the administration of grants, the tendering and management of revenue contracts and the management of contract variations were highlighted in the Auditor-General’s Report for the Financial Year 2014/15, released on Wednesday (Jul 15).
In the report submitted by Auditor-General Willie Tan to President Tony Tan Keng Yam on Jul 1, four areas were highlighted for public sector entities to pay greater attention to:
In the report for the previous Financial Year released in July 2014, lapses in the administration of grants and commitment of public funds were also highlighted.
In the latest report released on Wednesday, the Auditor-General’s Office (AGO) said: "The common weakness observed include failure by the public sector entities to ensure that the correct amount of grants are disbursed and conditions for grants are adhered to. For proper accountability, it is important that controls and proper mechanisms are in place to ensure that grants are used for the intended purposes."
For issues in revenue contracts, the AGO said: "These lapses raised concerns on whether the key principles of open and fair competition, and transparency, had been upheld."
Other areas cited in this year's report were lapses in procurement; controls over information technology (IT); and the management of assets.
Auditor-General Tan also flagged concerns over the lack of documentation on "decisions, actions taken and matters with significant financial implications" in the areas audited.
"AGO is aware that maintaining records requires time and effort, and hence AGO does not expect every issue to be recorded. However, AGO is concerned when entities are unable to produce any evidence of ... key considerations when decisions were made at the material point in time," he said.
The public sector entities singled out in the report include the People's Association, the Singapore Workforce Development Agency, the National Parks Board and the Institute of Technical Education and Singapore Polytechnic. In the case of the PA, a Citizen's Consultative Commmittee chairman fail to declare conflict of interest by awarding S$32,000 worth of contracts to a company at which he was a member of senior management, and had approved S$114,767 of his own claims. He has since stepped down, and an investigation was completed on Tuesday. PA has also taken immediate measures to ensure the lapses do not occur again.
"THE AUDITS GIVE ASSURANCE"
In the course of the audit, the AGO said that it carries out test checks of internal controls of selected areas in Government ministries and other state bodies. These include checks for "financial irregularity, excess, extravagance or gross inefficiency leading to waste in the use of funds and resources". The AGO also takes into account complaints received on the use and management of public funds and resources.
According to the Auditor-General, the annual report covers selected audit observations that are typically more significant in terms of monetary value, frequency of occurrence and impact on accounting. Minor lapses are also reported if they point to significant or systemic weaknesses in internal controls.
“The audits give assurance to the President and Parliament on the proper accounting, management and use of public resources. In the process, they strengthen the accountability of public sector entities as custodians and stewards of public resources,” the Auditor-General said in the report.
He also noted that the AGO conducts audits on a test-check basis, and thus may not reveal all irregularities and weaknesses. “However, they should help to uncover some of the serious lapses.”
All observations from the audit are conveyed to the respective ministries, statutory boards and other related bodies by way of AGO Management Letters.